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In 2001 and 2002, federal prosecutors indicted the Mayor of Bridgeport, Connecticut, and a dozen conspirators on charges of racketeering, extortion, mail fraud, and tax evasion. In March 2003, the mayor was found guilty on 16 counts, and most of the others indicted have pleaded guilty. While the indictment did not refer to any misuse of federal funds, some of the corrupt activities were associated with projects that had received some federal funding in the past. This corruption has raised concerns about the adequacy of monitoring and oversight of the more than $82 million in federal funds Bridgeport has received in recent years. Congress asked us to examine federally funded programs operated by the city of Bridgeport and determine whether and to what extent the respective federal agencies, including program officials and Offices of Inspector General, have heightened program monitoring and oversight in light of the corruption.

The six federal agencies that provided funds to Bridgeport generally have not heightened monitoring and oversight activities in response to the Bridgeport corruption, but rather have continued to oversee program funding through routine, generally risk-based monitoring and oversight activities. These activities include the review of Single Audit Act audit reports and other reports required of fund recipients, comprehensive program reviews, field visits to grantees, and assessments of state oversight in cases where federal funds are provided to localities through states. In recent years, these types of monitoring and oversight activities in Bridgeport have not revealed misuse of federal funds. Further, according to a senior FBI agent who participated in the Bridgeport corruption investigation, the FBI did not identify any internal control weaknesses on the part of federal agencies as the basis for the corruption and concluded that the corruption was caused by corrupt individuals in the local area.